Trade is a two headed coin: there are no debtors without creditors.
Amazing Story #426: Now that the IMF didn't give Italy E600 billion, let's try this one: The EC “will propose a new scheme for pricing bank-debt guarantees that seeks to isolate the 'intrinsic' risk of a bank from the risk of its home-country government.” Details were sparse, but Italy complained they wouldn't get a big enough break, and those few eurozone countries that are still AAA rated are against providing joint guarantees on bank debts. Bankers are trying to get someone, anyone, to save their asses assets. Another one for the fiction file.
The Big Sleep: The OECD has cut its forecast for economic growth in the OECD countries from 2.3% to 1.9 for all of 2011, and from 2.8 to 1.6% for 2012. Its main concern was whether the European monetary union would still be around come 2013.
Under Oath: When it learned that the FBI had been lying to the court about the existence of records sought under a FOI request, the judge was not amused.
Fine Print:In the name of security, the Senate is considering a bill that would permit the president to order the Army to pick up and imprison without charge or trial US civilians anywhere in the world, including in their homes in the USA. The actual wording authorizes “the worldwide indefinite detention without charge or trial.” Why now?
Read Slowly, Aloud: “Germany insists that Eurozone countries move aggressively to slow growth and raise unemployment.” No, it's not Krugman.
To Infinity and Beyond: Every time I hear the big investment houses claiming that the $707,568,901,000,000 in unregulated derivatives is all hedged and there's no risk of significant losses, I wonder what will happen when just one link in the circular chain of hedging fails. Like AIG. Or MFGlobal. How good is the bet when the bookie can't cover it? A ten percent fail rate would be the loss of more than the entire world's GDP.
W/O Comment: Two Chinese warships have begun a five-day “official visit” to Kuwait.
The Way-back Machine: The professor set the dial for 2003, the previous time the average new house went for $242,300. (The median selling price of all houses was $175,250, down 7.8% y/y.) Annualized new house sales were 307,000, up a tad from last months (downwardly revised) 303,000.
D-Minus, At Best:US District Judge Jed Rakoff reviewed the SEC/Citigroup scam and couldn't give it a passing grade. He concluded “that the proposed Consent Judgment is neither fair, nor reasonable, nor adequate, nor in the public interest." Trail date, July 16, 2012, when Citi will actually have to face a jury.
Hoja's Donkey: Hear the one about Hoja feeding his donkey a little less every day, and just when it had learned to live without eating, it died? Neither did Senator Kyl (R-AZ) who is opposed to extending the payroll tax cut, thus raising the average family's taxes by $1,000 next year while killing another half-million jobs. Kyl didn't mention that he is also against raising taxes on millionaires, but he is.
All Headline: The Probability Of Multiple Defaults By Euro Area Countries Is No Longer Negligible". The rest is details, none of which are new.
Tailored Fit: Companies are telling the Republican-led Congressional committees that there will be layoffs and plant closings if the EPA tries to curb air and water pollution. But when they're talking to Wall Street analysts they downplay regulatory costs, saying compliance will not affect profitability.
G'way Kid, Y'Bother'n Me: When economists talk about “the consumer” they are not talking about you and me. Or at least not me. They're talking about the top 20% of income earners, who account for about 45% of all spending. The rest of us buy groceries and gasoline.
Low-Fact Diet: The Plan, co-sponsored by the Eurozone leadership, the IMF, the GOP, and Great Britain, goes like this: 1) Cut government spending. 2) Then something, something... and then 3) Prosperity! Austerity for the poor and middle class is still their favorite for Step Two, even though it hasn't worked and – following simple math – won't. But Step One is a sure thing in their ideology. Sure to make matters much, much worse.
4 comments:
Re Hoja's Donkey/payroll tax cut - I find myself convinced by Dean Baker: The Payroll Tax Cut: A Stimulus That Progressives Should Oppose
http://yubanet.com/opinions/Dean-Baker-The-Payroll-Tax-Cut-A-Stimulus-That-Progressives-Should-Oppose.php#.TtToyWPaLmk
Basically, he says that cutting off the Social Security systems dedicated stream of revenue (the food for the donkey) is a prelude to killing the donkey (destroying Social Security as a reliable entitlement, making it into a "charity" that goes to "poor people").
See if you don't find Baker's argument reasonable.
As George Carlin said, several years ago, "And now they’re coming for your social security money. They want your retirement money. They want it back so they can give it to their criminal friends on Wall Street. And you know something. They’ll get it. They’ll get it all from you sooner or later ‘cause they own this fucking place. It’s a big club. And you ain’t in it. You and I are not in the big club. By the way, it’s the same big club they use to beat you over the head with all day long when they tell you what to believe. All day long beating you over the head with their media telling you what to believe, what to think and what to buy."
http://www.youtube.com/watch?v=i5dBZDSSky0
Well, yeah. I'd like to make the nuanced argument that the Dems fell into the Repubs trap on this one. The idea of getting more spendable cash into the hands of the people was and is valid. Doing it this way was stupid.
There's the Kensyian argument that as long as the income stream is restored once the Great Recession is over will cure this and the rest of SS/Medicare's funding problem. Come happy days make all income subject to SS/Medicare taxation. Period. Dividends, cap gains, interest, with no caps.
Or one could argue that Eat Drink and Be Merry in the face of what's coming is the only rational approach. That even if the GR doesn't get us, there's no way that the US taxable base (ie the middle class and poor) can ever pay back the money that's already been "invested" in Special Treasury Bonds and expecting the rich to begin sharing the load is simply not realistic.
I'm just all in favor of keeping up the pretense for as long as possible.
ckm
And yes, just to beat a couple of you to the punch line, assuming the Great Recession will ever be over assumes facts not in evidence.
ckm
Re "Tailored Fit": Eliminate all environmental regulation and these same companies would then be complaining about the unfair cost of worker safety regs, then product safety regs, then the 40 hour work week, then child labor laws, then indentured servitude. Oh wait, Newt the tool is already doing his handlers bidding by complaining about child labor laws. Guess I got the order of complaint wrong.
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